Question 1

Social insurance programs partially replace income that has been lost due to the following, except

Accepted Answer

A)  retirement.
B)  disabilities.
C)  temporary unemployment.
D)  resignation from a job.E) A) and B)
F) All of the above

Question 2

The Lorenz curve

Accepted Answer

A)  plots graphically the poverty rate over time.
B)  is located closer to the diagonal today than it was in 1975.
C)  plots graphically the distribution of income.
D)  is located farther from the diagonal when income is defined to include the value of noncash transfers.E) All of the above
F) A) and C)

Question 3

The U.S.poverty rate for the elderly (65 and over) is higher than for the general population.

Accepted Answer

A) True 
 B)False

Question 4

The Temporary Assistance for Needy Families (TANF) program expanded welfare benefits and has no limit on the number of years for receiving welfare benefits.

Accepted Answer

A) True 
 B)False

Question 5

Which of the following would be considered part of wealth?

Accepted Answer

A)  wages and salaries
B)  rental payments
C)  profits from a corporation
D)  corporate stock holdingsE) A) and B)
F) A) and C)

Question 6

The earned-income tax credit (EITC)  is, in essence,

Accepted Answer

A)  a tax credit for corporate contributions to charity.
B)  a tax break for businesses that invest in community programs.
C)  an income payment to those individuals who are not able to work.
D)  a wage subsidy for low-income workers to offset Social Security taxes.E) All of the above
F) C) and D)

Question 7

In the quintile distribution of income, the term "quintile" represents

Accepted Answer

A)  5 percent of the income receivers.
B)  10 percent of the income receivers.
C)  20 percent of the income receivers.
D)  25 percent of the income receivers.E) A) and D)
F) C) and D)

Question 8

Of the following groups, which had the highest incidence of poverty in 2014?

Accepted Answer

A)  African Americans
B)  Hispanics
C)  female householders
D)  persons 65 or olderE) B) and D)
F) A) and B)

Question 9

In 2014, the official poverty line for a household of four in the United States was

Accepted Answer

A)  $24,230.
B)  $32,473.
C)  $12,071.
D)  $26,803.E) All of the above
F) A) and B)

Question 10

The degree of inequality in income distribution based on single-year data is

Accepted Answer

A)  understated even though it takes into account income mobility.
B)  overstated because it does not take into account income mobility.
C)  understated because it does not take into account income mobility.
D)  overstated even though it takes into account income mobility.E) None of the above
F) A) and B)

Question 11

The TANF program is designed to

Accepted Answer

A)  increase the minimum wage.
B)  shift people from welfare to employment.
C)  provide medical insurance to poverty-level workers.
D)  provide income to the blind and disabled.E) A) and B)
F) A) and C)

Question 12

The empirical data indicate that the tax system and the transfer programs of the government

Accepted Answer

A)  increase the degree of inequality in the distribution of income.
B)  make no change in the degree of inequality in the distribution of income.
C)  reduce the degree of inequality in the distribution of income.
D)  affect the distribution of wealth, not income.E) B) and C)
F) A) and B)

Question 13

Another term often used to refer to family wealth is

Accepted Answer

A)  income.
B)  net worth.
C)  salary and wages.
D)  spending.E) C) and D)
F) All of the above

Question 14

In 2014, the highest quintile of households in the U.S.income distribution received about

Accepted Answer

A)  43 percent of total income.
B)  55 percent of total income.
C)  62 percent of total income.
D)  51 percent of total income.E) B) and D)
F) All of the above

Question 15

The crowding of women, African Americans, and certain ethnic groups into less-desirable, lower-paying occupations is

Accepted Answer

A)  employment discrimination.
B)  human capital discrimination.
C)  statistical discrimination.
D)  occupational segregation.E) B) and D)
F) A) and B)

Question 16

Which is a payment or wage subsidy made by the Federal government to offset Social Security taxes for low-income workers?

Accepted Answer

A)  the food-stamp program
B)  Supplement Security Income
C)  the earned-income tax credit
D)  Temporary Assistance to Needy FamiliesE) A) and B)
F) A) and C)

Question 17

The eligibility basis for the Supplemental Nutrition Assistance Program (or SNAP, formerly called the food-stamp program)  is

Accepted Answer

A)  age.
B)  illness.
C)  income.
D)  disability.E) A) and B)
F) A) and C)

Question 18

Suppose Rita obtains 10 units of utility from the last dollar of income received by her, and Joseph obtains 6 units of utility from the last dollar of his income.Assume both Joseph and Rita have the same capacity to derive utility from income.Those who favor an equal distribution of income would

Accepted Answer

A)  advocate redistributing income from Joseph to Rita.
B)  advocate redistributing income from Rita to Joseph.
C)  be content with this distribution of income between Rita and Joseph.
D)  argue that any redistribution of income between them would increase total utility.E) B) and C)
F) A) and B)

Question 19

The basic economic argument for greater income equality is that

Accepted Answer

A)  an equal distribution of income is the logical outcome of any tax-transfer program.
B)  because citizens enjoy political equality, they are also entitled to economic equality.
C)  a more equal distribution of income will tend to maximize incentives to work, invest, and assume risk.
D)  a more equal distribution of a given amount of income will increase the total utility of consumers.E) A) and B)
F) A) and C)

Question 20

One of the provisions of the Temporary Assistance for Needy Families (TANF)  program was to

Accepted Answer

A)  guarantee cash assistance for poor families.
B)  set a 5-year lifelong limit on welfare benefits.
C)  get the federal government to pay more of the cost of welfare.
D)  make welfare benefits more equitable among those receiving them.E) None of the above
F) A) and B)

Exam 23: Income Inequality, Poverty, and Discrimination

The U.S.poverty rate for the elderly (65 and over) is higher than for the general population.

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The crowding of women, African Americans, and certain ethnic groups into less-desirable, lower-paying occupations is

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In the quintile distribution of income, the term "quintile" represents

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In 2014, the highest quintile of households in the U.S.income distribution received about

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Which of the following would be considered part of wealth?

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The earned-income tax credit (EITC) is, in essence,

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The Lorenz curve

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The eligibility basis for the Supplemental Nutrition Assistance Program (or SNAP, formerly called the food-stamp program) is

Correct AnswerverifiedShow Answer

The degree of inequality in income distribution based on single-year data is

Correct AnswerverifiedShow Answer

Which is a payment or wage subsidy made by the Federal government to offset Social Security taxes for low-income workers?

Correct AnswerverifiedShow Answer

One of the provisions of the Temporary Assistance for Needy Families (TANF) program was to

Correct AnswerverifiedShow Answer

The Temporary Assistance for Needy Families (TANF) program expanded welfare benefits and has no limit on the number of years for receiving welfare benefits.

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Of the following groups, which had the highest incidence of poverty in 2014?

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Social insurance programs partially replace income that has been lost due to the following, except

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The TANF program is designed to

Correct AnswerverifiedShow Answer

In 2014, the official poverty line for a household of four in the United States was

Correct AnswerverifiedShow Answer

Suppose Rita obtains 10 units of utility from the last dollar of income received by her, and Joseph obtains 6 units of utility from the last dollar of his income.Assume both Joseph and Rita have the same capacity to derive utility from income.Those who favor an equal distribution of income would

Correct AnswerverifiedShow Answer

The empirical data indicate that the tax system and the transfer programs of the government

Correct AnswerverifiedShow Answer

Another term often used to refer to family wealth is

Correct AnswerverifiedShow Answer

The basic economic argument for greater income equality is that

Correct AnswerverifiedShow Answer

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